Key Points
Shipping and allied industries are bracing for a rough patch with depleting margins as freight rates are falling to pre-Covid levels or even lower in certain cases with containers accumulating at Indian ports...
As things stand, freight rates in key transit routes have declined over the past 3-4 months to as much as just a quarter of what they averaged a couple of years ago due to lower consumption in western markets amid global economic headwinds...
With that, containers have piled up at Indian ports, resulting in a reversal of the situation from just a year ago when shippers were running from pillar to post to get their hands on empty containers...
China's persistent zero-Covid policy and the growing pile-up of laden containers across ports in Europe and the United States dragged the disruption well into 2022, with shipping lines registering dismal 30% schedule reliability levels, he said...
However, the spike ensured that despite recording the lowest operating performance levels in history, shipping companies abruptly posted record profits emerging from a 12-year downturn, Tanwar said.. With rates down as much as 70% compared to prevailing tariff levels during the pandemic, the industry could likely be entering another down cycle that will persist over 2-3 quarters, he said.However,.
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